Build Your Business to Sell

Build Your Business to Sell

Several years ago, the National Association of REALTORS conducted a survey of its membership (which at that time averaged 57 years of age) and simply asked the question, “What do you plan to do with your business when you retire or leave the industry?” …80% of those surveyed responded: “Walk away” … Immediately (and may I stress immediately) NAR re-polled those who responded to the survey and asked. “Why? Would you “walk away” and not sell your book of business? The response, although stunning was quite simple…“I have nothing to sell”…

Now there are several very loud and powerful messages here for one and all:

1. As Leaders in the industry (and I take responsibility as one), we have done a lousy job of helping the professional REALTOR to realize his/her value and ownership of the business they have created and sustained over their career.
2. As leaders, we have totally missed a huge opportunity to enable the professional REALTOR to build a marketable entity and empower each to transfer the ownership of that book of business.
3. Market share is at risk. When one REALTOR “walks away” …their fair share of the business goes back into the market and it’s all up for grabs again.
4. We are doing a disservice not only to the future industry leader who might consider purchasing an existing book of business and thus accelerating their career at the highest level possible.

This message should not be ignored or dismissed. The existing real estate professional’s book of business holds the key to success for all messages heard. Simply stated, it’s all about the BOB!

First things first! Mindset needs an adjustment:

Today’s professional must start to acknowledge that when they have dedicated years of service to our industry AND if they have built a viable business with a marketable database, they have an entity to transfer to a buyer which can be rewarded with residual income.

Regardless of your tenure, today is the day to start to build your book of business with the intention of selling to a buyer.

Leadership (specifically Broker/Owners) must start to build and provide systems to empower the REALTOR to successfully transfer their book of business.

Collaboration is a must. Leadership and the Seller of the BOB, must work together to successfully transfer the business into new hands.

Education is king. Seek the services of a professional who has successfully participated in the transfer of ownership of the business to coach and lead you through the process.

The 4 D’s to successfully Build your Business to Sell:

Design Your Plan of Action:

• Determine your objectives for each phase of transitioning of business:
  • Vision and Goal
  • Working in partnership with your Leadership Team (Broker/Owner/Manager)
  • Value of the business being conveyed
  • Timeline for your exit from the business
  • Terms desired for the buyout

Define your Data Base:

• This is a collection of not only who you know, but who knows what you know…and who you are not afraid to reach out and ask for business.
  • Core of Influence (COI):
    • All individuals who are in your tribe. Those who will send business your way every day with no solicitation or expectation from you whatsoever.
  • Sphere of Influence (SOI):
    • All individuals in your scope of influence including yet not limited to family, friends, co-workers, business associates, allied resources, networking groups including neighborhood organizations, social groups, and church groups.
  • Geographic Farms:
    • Commit to touch each member within your data base on a timely, consistent schedule that is non-negotiable.
      • Digital messaging
      • Social Media
      • Voice to Voice
      • Face to Face

Discern the Best Fit to Purchase your BOB:

Work in partnership with your Leadership Team (Broker/Owner and Manager) to attract the talent to take over the business. Consider the following:

• Behavior Styles
  • Are you well matched to work together to transition the business?
  • Will their behavior/work ethic be well suited to serve your business base and create retention of your BOB?
• Manageable Production Volume
  • Will the Buyer be able to manage and grow the BOB?
  • Implementation of existing systems
  • Introduction and adoption of new systems
  • Build staff loyalty and retention
  • Increase sales volume and enhanced production
  • Sustain profitability of the BOB
• Will the buyer be able to handle the combined volume of their existing BOB plus the purchased BOB?
  • What will the combination of existing systems look like?
  • What results are expected?
  • What will the combination of the staff/Team members look like?
    • Who will do what?
    • Define each role/expectation

Deliver a Turn-Key, Viable Entity:

Delivery of the BOB is critical for sustainability. Remember, the difficulty in transferring a book of business in real estate vs. most other businesses, is that you are conveying a relationship of loyalty and trust…not a sanctioned business. The devil is in the details!

• Communication
  • Understanding the needs of all parties involved: Seller/Buyer and Broker
  • Delivering extraordinary experiences to all parties involved; especially the clients served to ensure continued success and growth for the BOB
• Systems
  • Adoption of existing systems of the Seller
  • Introduction of existing systems of the Buyer
  • Merging of the two to provide the best solution for all
• Contractually solid terms
  • Executing a legally binding and enforceable contract
  • Covering all parties (in writing) to prevent disruption pre-and post-closing
  • Determining the value of the BOB and setting expectations for payment
  • Setting standards and expectations for how to grow, sustain and retain the BOB
  • Establishing marketing expectations (Soup to nuts)
• The Seller’s Exit
  • Setting the specific date, the Seller Exits
    • Expectations pre-and post-exit
    • Scripts, dialogs and standards to be used post-exit

The National Association of Realtors had a right to be concerned. With so many talented, dedicated and passionate individuals representing its membership averaging an age of 57, how they “leave” the business is critical.

You can walk away, and never look back.
You can leave the business you’ve worked so hard to build with no residual income.

You are in control of how you build your business and how you sell your business.
You are in control of the residual income you earn from the sale of your business.

You can transition your business under the conditions of blood and guts or you can transition your business with ease and elegance.

Choose ease and elegance.